The Danger in Mexico’s Divided House

Reform movements have triggered many revolutions in Mexico. Those put forward by President Enrique Peña Nieto since his inauguration in December 2012 are not likely to set off a violent uprising, but the negative reaction to some of his proposals is intense — and promises to become much stronger.

Throughout Mexican history there is a pattern of reform and ensuing revolution. At the end of the 18th century, Spain’s monarchs imposed a series of profound economic and political reforms on their American dominions. The moves were meant to strengthen the power of the crown at the expense of the church and other civil corporations that had amassed great wealth. The response of Spain’s American subjects, especially the Creoles (American-born Spaniards) and including aggrieved clerics and landowners whose properties had been confiscated, was the Mexican war of independence, which led to Spain’s withdrawal in 1821.

In 1857, the passage of a new constitution and the so-called Laws of Reform sharply reduced the material and spiritual privileges of the still-powerful church, sparking a civil war between Liberals and Conservatives. Twenty years later, following the precepts of 19th-century liberalism, the dictator Porfirio Díaz opened Mexico to foreign investment and modernized the economy. But his policies also increased the suffering of large swaths of the populace: peasants encircled by the expansion of haciendas and workers exploited by American mining companies. Feelings of nationalism and a craving for social justice rose, setting off the great national earthquake that was the 1910-1920 Mexican Revolution, a resounding rejection of the economic and social values of liberalism.

By the end of the revolution, tensions between societal forces and liberal laws produced a hybrid: a powerful central state that formally respected individual freedoms but organized social forces in a corporative order strangely similar to that of Spanish colonialism. This outcome was the secret to the long domination of the PRI, the party in power from 1929 to 2000. The president, a near monarch, ruled the country like a sun around whom circled union members, peasants, bureaucrats and even businessmen dependent on the state’s protection.

Just 20 years ago Mexico experienced a new variation on the historic coupling of reform and revolution. Only a few days after the signing of the North American Free Trade Agreement between Mexico, Canada and the United States (a move of classical liberalism), an indigenous rebellion broke out in the southern state of Chiapas on Jan. 1, 1994. Its leader, Subcommander Marcos, saw the Nafta accord as surrendering Mexico to the forces of international capitalism.

In the end, however, Mexico’s old model of governance was brought down not by economic liberalism but by the rise of democracy. First, in 2000, the president as monarch vanished from the scene. The legislature became a genuinely multiparty body, and the Supreme Court far more independent. Free elections were overseen by an entity independent from the government.

Still, those interest groups that had long been dependent on and controlled by the presidency did not exit the scene. On the contrary, they grew dangerously stronger, each trying to secure a place at the center of power. Three of the major reforms proposed by Peña Nieto’s government aim to limit their influence.

The Education Reform (already approved by Congress) requires evaluations of all members of the huge teachers union and aims to improve the painfully poor level of public education. The Telecommunications Reform (also approved) opens the sector to new participants, limiting the domination of a handful of companies, and creates bodies to oversee competition throughout the economy. The Energy Reform (pending) attempts to reverse a decline of oil production by ending the monopoly of Pemex, the state-owned oil company, allowing it to make contracts with private companies for the extraction of petroleum and shale gas; this bill will be the toughest to get through Congress.

Parallel to these liberal reforms, Congress approved a Fiscal Reform with a number of “redistributive” measures sought by the left that reduce the overly favorable fiscal treatment enjoyed by large enterprises and big political contributors. And the Peña Nieto government, in a gesture against a plague of obesity, raised the sales tax on junk food and soft drinks. Revenues from these measures will go to creating or expanding social programs like universal medical insurance, old-age pensions and unemployment insurance. But the business sector has balked at these steps, questioning whether the new income will be used effectively, be wasted in a senseless expansion of unproductive bureaucracy or disappear down the drain of corruption.

Despite their limitations and defects, the government reforms are the product of tough negotiations between the three main political parties — the PRI, PAN and the PRD — that produced a “Pact for Mexico.” The accord has no precedence in the country, and also permits discussion of an important Political Reform that would, among other things, permit the re-election of representatives to Congress (now forbidden by the Constitution), a necessary measure that would make elected officials more accountable to the people. Its approval would greatly strengthen the young Mexican democracy.

But opposition to the reforms in Congress must be distinguished from that in the streets and the social media, where rejection of the Energy Reform is emphatic and approval of the Education Reform is far from unanimous. This current of opposition even rejects the legitimacy of the representatives responsible for approving or disapproving the reforms.

These voices are heirs to the original ideology of the Mexican Revolution, and their radical beliefs are statist, corporatist and nationalist. They reject the free market and assert, justifiably, that the social programs implemented over the past 20 years to combat poverty have failed. To them Mexico is not a democracy but a corrupt, business-run oligarchy in democratic dress. Theirs is a current that threatens to erupt into civil disobedience. They number in the millions — and they are voters; hundreds of thousands of them could descend into the streets.

Mexico is a country divided — especially over the Energy Reform — with no consensus on its future direction. Worse, according to a recent poll in the journal Latinbarómetro, the average Mexican is losing faith in democracy. In 1995, 45 percent of those polled said democracy was the best form of government; today only 37 percent agree.

Can a house this divided against itself continue to stand? Likely it can. But it will fall if it doesn’t engage all of the nation’s competing voices in a real dialogue to steer Mexico down the road to genuine prosperity and democracy.

Enrique Krauzeis a historian, the director of the literary magazine Letras Libres and the author of “Redeemers: Ideas and Power in Latin America.” This article was translated by Hank Heifetz from the Spanish.